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Hey everyone,
Recently found out that gas-hybrids made up 12.6% of all vehicle sales in April, the highest on record, according to Cox Auto.
They’ve also been consistently dominating the “electrified” market—making up 58% of sales overall.
As the EV market recalibrates, it looks like hybrids are proving to be the right fit for the moment.
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Welcome to The Breakdown, an analysis of auto retail’s top trends, moves, and insights—in under 5 minutes.
While the publicly traded dealership groups pull back on acquisition spending (down 91% in Q1), a new wave of regional buyers is stepping in, and they're buying stores they know how to fix, in markets they already understand.
To find out more, I spoke with some regional buyers across the country who have been quietly building economies of scale.
And I've discovered three ways these dealers are growing without losing their operational edge...
These buyers are assessing local demand, fixed ops capacity, and retention potential to find the right deal.
Public groups and private equity (PE)-backed retailers will happily pay top dollar for a high volume Toyota franchise. They've got the capital and they're playing a different game. But small to mid-sized operators who are putting their own money on the line are all about upside.
Southeast dealer Matt Bowers has a four-step filter he runs before he even entertains the idea of a deal. First, he looks at the town and county: "Does the town have some economic driver? Is it growing in size? What are the outside influences on that particular part of the country?"
Matt Bowers
Then he gets tactical. Really tactical.
Matt pulls up Google Street View to count service bays, multiplies that number by $17K-$25K expected gross per bay, and if he can't see a path to 18-20 bays minimum, he's out.
"No point in buying a store where you can't grow fixed. If the building can't expand, neither can your gross."
Northeast dealer Gerry Raymond takes a different but equally thorough approach.
"I look for two things. One, the manufacturer's playing potential. So how many cars the manufacturer says that you should be doing, right?"
The second thing he looks for is repair order (RO) count. "You know, it sounds maybe a little bit silly, but the RO count," he said. If customers are coming for service but not buying cars, there's a retention problem he can fix.
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Regional buyers are making decisions solo, prepping talent early, and overhauling operations immediately.
"I don't really have people to answer to,” Gerry told me. So, it's not like I have to go through 10 family members or a board of directors or anything. I'm a decision maker.”
Gerry Raymond
That speed advantage comes in handy when a good deal surfaces quickly. But executing the transitional period of bringing on a new store is what matters most.
The moment someone sells their dealership, everything changes whether the new owners want it to or not.
"Once you buy a car dealership, a business like that, I don't care what you hope or wish. The people who know the business know. Once you buy it... it's not the same thing that you bought the day before. It's totally different now," said Matt.
So, he stopped pretending otherwise. DMS conversions, website migrations, and compensation plan adjustments all happen in week one.
"If we're going to change it, you already know you're going to change it. So why are we going to wait six months to change it?" added Matt.
And savvy regional buyers prepare for this reality before they even submit offers. Alan Haig, CEO of M&A advisory firm Haig Partners, sees the best operators recruit general managers and sales managers during due diligence, not after closing. They often know exactly who will run the store before signing the papers.
Larry Morgan has 70+ stores. And every single one is in Florida.
The reason: Geographic concentration creates operational leverage that gets stronger with each new acquisition.
For example:
Bulk purchasing power on everything from floor mats to finance rates—vendors give better deals when you're buying for 70 locations.
Staff can transfer between stores without learning new systems or relocating their families.
Marketing dollars work harder—one TV ad in Florida reaches customers for all 70 stores, while a national chain would need 50 different media markets.
However, when Larry started expanding beyond his first store, he tried running each location like its own kingdom. Different accounting systems, CRM platforms… everything.
"It was a nightmare," he told me. "We'd have three stores using three different DMS systems, and I'd spend half my day just trying to figure out what was actually happening."
Larry Morgan
So, instead of trying to manage complexity across multiple stores, he decided to go deep in one market and build systems that worked everywhere. And he standardized it all—accounting, CRM, training programs, and operational standards.
And with every store under one regulatory roof, Morgan’s group can pull from a massive unified customer database. That means when a customer’s lease is ending at a Toyota store, the CRM can generate follow-ups from sister stores across other brands. And if that customer moves across town, any service department in the group can pick them up without skipping a beat.
At a high level, regional operators are proving there’s another way to grow.
But the approach is rooted in operational discipline, not just capital. And as more high-performing rooftops come to market (and they will), the edge will go to the buyers who already know the ZIP code, the people, and the playbook.
Which dealer group growth strategy makes the most sense to you?
Missed yesterday’s episode of Daily Dealer Live?
Presented by: Impel
O'Neil Nissan on service retention strategy, VADA CEO on recent policy battles
Featured guests:
Drew Pearlman, General Manager at O’Neil Nissan
Don Hall, CEO of the Virginia Automobile Dealers Association (VADA)
This week on the
Becoming Canada’s #1 VW CPO dealer: What’s working, what’s broken, and where profit is slipping away
Shout out to Uber for Business, Experian Automotive, and Nomad Content Studio for making this episode possible!
Stream now on:
The big shift—why omnichannel dealers are winning, and fragmented stores are falling behind
Shout out to Numa, Lotlinx, and Cox Automotive for making this episode possible!
Stream now on:
Three opportunities hitting the CDG Job Board right now:
Del Grande Dealer Group: General Manager (California)
Phil Long Dealeships: Sales Manager (Colorado)
Libertyville Lincoln: Sales Consultant (Illinois)
